New Data Show Strong Job Market

By Toni Vranjes

July 3, 2014

Hiring in the U.S. was brisk last month, as the economy added 288,000 new jobs, the Labor Department reported today.

In addition, unemployment fell from 6.3 percent to 6.1 percent, the lowest rate in nearly six years. The last time the jobless rate was at 6.1 percent was in September 2008. Meanwhile, the labor force increased by 81,000.

down_arrow-6_pt_1For April and May combined, the government revised job growth upward by 29,000. Over the past three months, employment growth has averaged 272,000 per month, according to the Labor Department.

In another positive sign, the job growth was spread among many different areas. Last month, professional and business services added 67,000 jobs, and retail trade grew by 40,000. Employment at food services and drinking places increased by 33,000, and health care added 21,000 jobs. Job gains also occurred in transportation and warehousing, financial activities, manufacturing, and wholesale trade.

Overall, the June employment numbers were very good news, said Tara Sinclair, an economics professor at George Washington University, and an Indeed economist.

“Almost all of the indicators moved in the right direction, which is a very good sign,” she said in an e-mail. “We’ve seen in past months that the unemployment rate sometimes falls due to people leaving the labor force rather than finding jobs, but this month we saw the number employed (according to the household survey) increase substantially.”

Indeed’s analysis of May industry trends suggests that there is broad growth across all employment sectors, according to Sinclair. She explained that Indeed’s trends are based on job postings, so they match up well with June hiring.

Sinclair also noted that the “employment-to-population ratio,” although up slightly from last year, is still very low. This ratio measures the percentage of the population ages 16 and older that is employed.

“I’m hoping to see people rejoin the labor market as we continue to see job growth,” Sinclair said. “This might result in the unemployment rate ticking up a bit temporarily, but it might be for good reason if people return to the labor market because they now think they will find a job.”

The economy has been creating both low-wage jobs and high-wage jobs, she observed.

“Looking at postings over the last few months on Indeed it looks like there is now a wide variety of jobs experiencing growth – and a lot at the upper end,” Sinclair added. “But, most of these higher wage postings require a college degree, so we’re continuing to see difficulties for people who used to be able to earn a good living without going to college.”

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